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A. If the economy booms, ABC Inc. stock is expected to return 20 %. If the economy goes into a recessionary period, then ABC is

A. If the economy booms, ABC Inc. stock is expected to return 20 %. If the economy goes into a recessionary period, then ABC is expected to only return 8 %. The probability of a boom is 30 % while the probability of a recession is 70 %. What is the variance and standard deviation of the returns on ABC Inc. stock?

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